Shell and Lufthansa have announced plans to enter a supply agreement for 1.8mn MT of sustainable aviation fuel, marking one of the largest commercial SAF deals to date, and the largest for either of the companies to date. Under the terms of the potential agreement, Shell would supply as much as 594mn gallons to Lufthansa at airports around the globe. According to the companies, the deal would contribute to both Shell’s ambition for at least 10% of its aviation fuel sales by SAF by 2030, and Lufthansa’s goal to “promote the availability, market ramp-up and use of SAF as an essential element for a CO2-neutral future of aviation.” The deals come as the aviation industry is facing increasing scrutiny as a significant source of GHG emissions, responsible for 2-3% of global emissions, with that figure set to rise dramatically over the coming decades if no action is taken. SAF is seen by market participants as one of the key tools for the industry to address its climate impact, as it generates significantly lower lifecycle carbon emissions – up to 80% lower – relative to conventional jet fuel.

Source:  ESG Investing